Unbundling Of EU Energy Markets? Not If The French And Germans Get Their Way

The Brussels Peak in June saw the new French President Nicolas Sarkozy succeeded in convincing the ECU to drop its dedication to agree and undistorted competition from its reform concord. Though Competition Commissioner Neelie Kroes disagrees this may have tiny impact on Brussels troublesome position against conglomerations, illegal assistance and protectionism ; many legal professionals support the position the new arrangement will weaken the Commissioner’s capability to tighten up on such continuing practices.

As if to rub salt in the injuries, current comments following the authorized merger between GDF and Suez by Jean-Pierre Jouyet, France, Europe Minister are probably going to further inflame relations. Referring to the alliance, Jouyet remarked to hacks : its a vision of what may be the energy policy for Europe? This has to be especially disturbing to Kroes who has been careful to make sure that the coalition was scrutinized from top to bottom to find out any adverse effect on competition, also making certain the disposal of assets and concessions formed the founding conditions for any potential deal.

To retaliate, Jouyet further expanded on the growing division between Paris and Brussels by saying that Kroes?unbundling plan was an ideological view, we’ve got a strategic view. It’s a better balance between EU interests and competition rules?

Since this delicate and public series of events, Kroes has made no effort to hide her doggedness to battle nail and tooth against the protectionist policies of the French, German and Spanish member states. Though she stayed silent in the peak talks, one observer believes that Ms. Kroes and her aides were alarmed at the obvious shortage of concern from liberal states like Britain and Sweden and also from Jose Manuel Barroso, Western european Commission President? Mr Barrosso appeared convinced previously that erasing competition as an objective had no legal bearing, since the policy was discussed thirteen times somewhere else in the deal. the French state and other legal professionals obviously think differently.

Whatever the legal contentions, the Commission will this month present detailed offers for an overhaul of ECU energy market laws. ECU Energy Commissioner, Andris Piebalgs is predicted to proffer the integrated groups inside member states be made to sell their electricity grids and pipeline networks a definite most important step towards unbundling. But just how far this can be permitted to progress depends seriously on the power of the influential French and German lobbies.

So, why should a business within a single EU member state concern itself with what is going on with competition policy across the whole of the EU? Any attempt to stifle competition in Europe will have a profound effect on our UK market. As we are highly dependent on Europe for much of our energy supply and as current European practices falsely peg the wholesale gas price to the price of oil, it is in our best interest to see a break-up of the unhealthy dominant forces which control and distort the market mechanism.

Examples of this distortion are at present being probed by the Commission. These concerns surround the withholding of production capacity on electricity markets with the view to raise costs.

Lastly, commentators have announced there’s abuse of electricity balancing markets and since this is probably going to have best effect on more recent entrants and so, for smaller players who continually depend on these sources, it’s a limiting factor on the growth activity of these companies.

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